LONDON, Feb 1 (Reuters) - Vodafone posted a disappointing trading update on Wednesday and dragged British shares into a third day of losses as outsourcing firms failed to recover after Capita’s profit warning during the previous session.

The FTSE 100 fell 0.6 percent to a six-week low with most European bourses also closing in negative territory.

Intense competition in Spain and Italy took the shine off Vodafone’s third-quarter revenues and sent the shares of the world’s second largest mobile operator down 4.5 percent.

IWG tumbled 14.4 percent after Canadian private equity firm Onex and Brookfield Asset Management said they would not make an offer for the British serviced office provider.

Building products distributor SIG retreated 4.1 percent after it said its 2016 profit was overstated.

A stand-out performer was NEX Group, jumping 7.7 percent after the financial technology firm said “noticeably” more active markets this year had helped its revenues rise.

Private equity group 3i rose 1.9 percent after reporting a rise in net asset value per share, after increasing its valuation of its ten biggest portfolio investments.

With sterling enjoying its best month against the dollar since 2009 in January, the FTSE 100 - whose companies derive around 70 percent of earnings from overseas - has been under pressure.

“The stronger pound is making the UK domestic market look a bit more attractive,” said JPMAM’s Illsley.

“People have been avoiding the UK but what I would detect is with the pound’s recovery people have been having to question that positioning. Some of the overseas equity holdings are now worth less in sterling terms,” he added.